Professional Tax Registration & Compliance Filing
Are you a self employed professional? Or you have employed people? Get Professional tax certificate with TAXAJ
It usually takes 3 to 5 working days.
- Issue of Enrolment/ Registration Certificate
- Documented Follow-up
- Business hours -CA support
- Does not include PT payment
- Every self employed professional
- Any entity employing one or more employees
- Purchase of Plan
- Upload documents on vault
- Filing of enrolment/registration application
- Receipt of enrolment certificate
Name, Contact Number and Email Id of Stakeholder.
Self Attested PAN, Aadhar & Passport size photo of Stakeholder.
Specimen Signatures of Stakeholder.
Latest Electricity Bill/Landline Bill of Registered Office.
NOC from owner of registered office. (If Owned)
Rent Agreement from Landlord. (If Rented/Leased)
PAN, TAN, COI of the Business Entity
Cancelled Cheque in business name
What is Professional Tax – Meaning, Rates & Compliance’s
Salaried employees should know ‘professional tax’ as it would have been mentioned in the payslips/Form 16. But they may or may not understand what it is and why it appears in their Salary slips as a deduction from their salary income. Hence, this article attempts to provide a better picture of ‘Professional tax’ and why it is deducted and is only the salaried class who are bearing it.
In this article, we will discuss the following topics:
1. What is Professional tax and who levies it?
The terminology ‘Professional tax’ does not convey the meaning. Unlike the name, it is just not levied on professionals only. It is a tax on employment such as professions, trades, and job work. Professional tax is based on the income of professional, trader and job work or contractual people employed. Professional Tax (P.T) also encompasses freelancers, professionals, etc., depending on minimum income criteria. The state can make laws only for the Concurrent and State list. State Government is empowered to make laws for professional tax. However, professional tax is an income tax is levied by State Government (not all states in the country chose to charge professional tax).
Professional tax(P.T.) is a deductible amount for the Income-tax Act, 1961 and can be deducted from taxable income.
2. Professional Tax Rate
Professional tax being levied by the State Government, is different in different states. Every state has its own laws and regulations to govern professional tax of that particular state. However, all the states do follow slab system based on the income to levy professional tax.
Further, Article 276 of the Constitution which empowers the State Government to levy professional tax also has provided for a maximum cap of Rs 2,500 beyond which professional tax cannot be charged on any person.
Few illustrative slabs in the country
Professional tax rate slabs in Karnataka
|Monthly salary/wage upto Rs 15,000||NIL|
|Monthly salary/wage > Rs 15,000||Rs 200 per month|
|Monthly salary/wage upto Rs 15,000||NIL|
|Monthly salary/wage between Rs 15,001 – Rs 20,000||Rs 150 per month|
|Monthly salary/wage > Rs 20,000||Rs 200 per month|
3. Who is responsible to collect and pay professional tax?
Professional tax is collected by the Commercial Tax Department. The commercial tax department of the respective states collect it which ultimately reaches the fund of municipality corporation.
Person responsible to pay professional tax
In employees cases, an employer is responsible for deducting and paying professional tax to the State Government. If any, this payment is subject to the monetary threshold provided by the respective State’s legislation. Additionally, an employer is also required to pay professional tax on his trade/profession. Thus, the employer needs to register and obtain both viz.
- A professional tax registration certificate to pay professional tax on his trade/profession
- A Professional tax enrolment certificate for deducting the taxes from his employees and paying to the State. Furthermore, separate registration might be required for each office depending on the respective State’s legislation.
Persons carrying on freelancing business without any employees are also required to register themselves under P.T. Act subject to the monetary threshold.
However, a professional tax levy is subject to the exemption provided by the respective State to specific categories. For example, parents or guardians of any person who is suffering from mental retardation, blind persons are exempted, among others, from the levy of Karnataka Professional tax.